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The most senior ETA leader still at large was arrested Saturday in southwest France, Spanish authorities said, dealing another major blow to the embattled Basque separatist group.

Mikel Irastorza, 41, was found in a home in the French town of Ascain, in the Pyrenees region bordering Spain, the interior ministry said in a statement.

The couple housing Irastorza -- a 59-year-old Basque exile and his 56-year-old wife -- were also taken into custody, French sources said.

Anti-terrorism prosecutors in Paris authorised the arrests and the three are due to appear before a judge in the French capital. On Friday French authorities opened a preliminary investigation into alleged criminal association with a terrorist organisation.

The Spanish statement said the raid, led by French security forces working with Spanish police, was aimed at the "leadership structure of ETA".

Irastorza was described by the ministry as "currently the most senior leader of the terrorist group ETA still at large". Spain said other arrests could follow.

Founded in 1959, ETA waged a violent decades-long campaign for an independent Basque homeland in northern Spain and southwestern France, and is blamed for the deaths of more than 800 people.

It declared a ceasefire in October 2011 but has refused to give up its weapons, and is seeking to negotiate its dissolution in exchange for amnesties or improved prison conditions for the roughly 350 ETA members held in both countries.

Spain's new Interior Minister Juan Ignacio Zoido, who was only appointed on Thursday, welcomed the arrest.

"As long as the terrorist group fails to give up its weapons for good and refuses to dissolve itself, the Spanish government will continue to fight the scourge of terrorism," Zoido told reporters.

On October 12 France and Spain announced the discovery of an ETA weapons stockpile in Carlepont, 120 kilometres (75 miles) from Paris. Six days later, ETA accused Spain and France of not wanting to "seek reasonable solutions" for peace in the Basque region.

ETA's influence has waned in the Basque region, its ranks thinned by arrests over the years on both sides of the border. Most ETA members are in prison and only about 20 are still at large, according to French and Spanish authorities.

Public support has also dwindled as many Basques view the armed campaign for an independent homeland as belonging to the past.